Fixed Pricing

[TC]

So what do you guys think??

Personally I hate it, it takes out the competition that drives down the price of things. Sure it helps the small guys stay in business, but that isn't doing the consumer any good, or the small guy that doesn't have a big name yet and people don't buy from. It's guys like that that need to be able to sell cheaper than the rest so that they can attract a piece of the pie.

Anyway is price fixing a good thing or a bad thing.

[MOPARS RULE]

Re: Fixed Pricing

Tubbed one, can you give some examples? WTF you must love to debate. :o

[TC]

Re: Fixed Pricing

Well since we're talking a cars on this site I was referring to car parts and more towards the line of performance parts. Basically how MSD, Edelbrock and other companies have told their suppliers what price they can sell the parts at. I remember this all started out with Edelbrock and the Performer intake, Checker Auto was getting into the performance parts business and they had to compete with Loper's here in Phoenix. Well Edelbrock started making Loper's and everyone else sell the Performer at a given price and they couldn't sell it cheaper than that price. Basically what was going on is Loper's was buying millions of dollars of Edelbrock and was able to get the Performers for cheaper than what Checker could get them for, so Checker cried, and Edelbrock responded. Now it seems that most of the big companies have these policies, and if you break them they will no longer do business with you. So basically I'm just asking if you agree with this or do you think they should let people sell at whatever price they can make money with.

I don't know it just seems kind of like a monopoly to me. Whatever happened to free enterprise.

[MOPARS RULE]

Re: Fixed Pricing

Does Jeg's and Summit know about this?
:D :D :D ;D

[BOWTIE6872]

Re: Fixed Pricing

Well since we're talking a cars on this site I was referring to car parts and more towards the line of performance parts. Basically how MSD, Edelbrock and other companies have told their suppliers what price they can sell the parts at. I remember this all started out with Edelbrock and the Performer intake, Checker Auto was getting into the performance parts business and they had to compete with Loper's here in Phoenix. Well Edelbrock started making Loper's and everyone else sell the Performer at a given price and they couldn't sell it cheaper than that price. Basically what was going on is Loper's was buying millions of dollars of Edelbrock and was able to get the Performers for cheaper than what Checker could get them for, so Checker cried, and Edelbrock responded. Now it seems that most of the big companies have these policies, and if you break them they will no longer do business with you. So basically I'm just asking if you agree with this or do you think they should let people sell at whatever price they can make money with.

I don't know it just seems kind of like a monopoly to me. Whatever happened to free enterprise.

sorry,, man.. they're not alowed to advertize(sp?) a lower price..
they can sell them for a buck if they want to..
no company is going to stop selling to jegs/summit
they put rules in place.. like that. so. the normal parts that most guy change.. don't get sold at summit/etc for less than the wholesale cost..
cause lets face it jegs/summit can afford to sell a pro rpm for under cost..
the little guy can't,, summit can still sell it for less than cost.. but they can't list it in they're catolog or web site.. for that..

[Schtauffer]

Re: Fixed Pricing

Free enterprise is the best way to structure an economy.

These companies are free to run their businesses however they choose, including their price structuring. If another company makes a better part for cheaper, that company will win the market.

[SuperBuickGuy]

Re: Fixed Pricing

It's a violation of Federal law to collude with other suppliers to fix prices. It's also a violation of Federal law to give one supplier a price advantage over another. But, as with everything else - there are exceptions and without going into a treatise on that - a supplier can set their price to whatever they want provided they are not selling at a loss to put another competitor out of business. And suppliers can give discounts to buyers when there is a true cost difference in selling between the two..... and the devil really is in the details of both of those situations.

[BOWTIE6872]

Re: Fixed Pricing

Free enterprise is the best way to structure an economy.

These companies are free to run their businesses however they choose, including their price structuring. If another company makes a better part for cheaper, that company will win the market.

and we should just become commies..
as we support them instead of an american company, when there is a choice, all because of the almighhty dollar..
america's world slavery tours. is almost dead.. and we're not gonna like how the hammer falls..

[TC]

Re: Fixed Pricing

sorry,, man.. they're not alowed to advertize(sp?) a lower price..
they can sell them for a buck if they want to..
no company is going to stop selling to jegs/summit
they put rules in place.. like that. so. the normal parts that most guy change.. don't get sold at summit/etc for less than the wholesale cost..
cause lets face it jegs/summit can afford to sell a pro rpm for under cost..
the little guy can't,, summit can still sell it for less than cost.. but they can't list it in they're catolog or web site.. for that..

Actually they're not, put it this way I know a local hot rod shop here was wholesaling these certain programmers to this guy that would resell them on Ebay. The guy would sell them cheaper than what the programmer company allowed. So the programmer company bought one, checked the serial number and found out that the units came from the local hot rod shop here. Anyway the local hot rod shop here was contacted by the programmer company and told no to sell to the guy anymore or they would not sell to them anymore. Personally I think it's BS, but I do know it's done to fair up the market so that basically guys like Jegs and Summit don't run the little guys out of business.

[Brad54]

Re: Fixed Pricing

It' also done from the manufacturer's perspective to sell more product.

If you've got a large retail network (resalers... Mail order places, local speed shops, etc.) and they don't have the juice to get the big volume discount, they can't sell the product as cheaply as Summit or Jegs. That means they aren't going to buy from you, because they won't sell any product.

For instance, let's take Summit, Jegs, Barnet Performance and Super Shops (not around anymore, I know). Summit and Jegs are going to buy a lot more Edelbrock Performer RPM intakes than Barnet or Super Shops. They'll get a much better price per unit than the other two. If Edelbrock doesn't set a minimum For Sale price with everyone, it won't take long before the majority of people buy the intakes from Summit and Jegs. Eventually, that's going to cause Barnet and Super Shops to sell even fewer intakes, and lose any kind of volume discount they got from Edelbrock. It won't take long before Super Shops and Barnet are buying them for what you or I could buy them for. Maybe they get a Jobber discount... 10-15 percent off.
But you and I don't have any business overhead, so even at 10-15 percent off, they'll lose money on every one they sell. Meanwhile, not everyone is buying from Summit and Jegs, because there ARE still people who don't buy from them. Maybe the customers start thinking about a Weiand or Holley intake, etc. etc.

Then, once Summit and Jegs put Barnet and Super Shops out of the Edelbrock Performer game, they become the only game in town. Guess what? Now they are free to jack the price up thru the roof, because they control the market. If someone wants a Performer, they only have two choices.

Then Summit and Jegs start doing the math, and realize that there are a certain number of people who are going to buy a Performer, and they'll spend X-dollars. They'll figure out how much they can charge, and how few intakes they need to sell to put a certain amount of money to their bottom line. At some point, they do that graph I mentioned in another post, and they realize that they can sell a particular number of intakes and make a particular profit, and selling more for less doesn't make good sense, because they'll have added transportation, staff, handling and shipping fees, plus it will cost them X-dollars in warehouse storage. Money that could be spent warehousing another product.

Edelbrock will sell more volume, and make more money, if they tell everyone "Look, once you do the buy-in, and have our minimum volume discount, you'll make X-percent mark-up on every one you sell, and you won't be undercut by the big boys. However, the big boys will make more profit per unit, because they're buying a larger quantity from us."

Remember... Business exists to maximize profit for the owners or stock holders. It's not an experiment for social injustice, or a means to an egalitarian society.

Taken long-term, US business practices are very successful. They alone have made the US the most prosperous nation in the world, with the highest standard of living. Unfortunately, the recent trend has been for short-term gain, damn the long-term vision and planning. "We want it all, we want it now, and we don't care if our kids are left having to pay for it." Part of that blame falls on the Baby Boomers, part on CEOs, part on the unions, and part on the government for mandating knee-jerk reactions (the housing industry collapse is directly traceable to getting away from time-proven methods of lending; The government broke the seal by requiring loans on sketchy credit, the lenders followed by drinking from the bottle like sailors on shore leave.)

-Brad

[Schtauffer]

Re: Fixed Pricing

Ahh well, Brad. Them liberals can't grasp the concept of long-term. In their mind, everything exists for their benefit.

[Mr4Speed]

Re: Fixed Pricing

Well said Brad, and thank you. We all want to get the maximum reward for the minimum effort in our own daily lives so why is it that when a corporate entity does it it's evil? We all want to earn enough to cover our living expenses and have enough left over to plan for our future and a potential loss of income, and to improve our standard of living as we go along. It's no different.

[Monk]

Re: Fixed Pricing

Well said Brad, and thank you. We all want to get the maximum reward for the minimum effort in our own daily lives so why is it that when a corporate entity does it it's evil? We all want to earn enough to cover our living expenses and have enough left over to plan for our future and a potential loss of income, and to improve our standard of living as we go along. It's no different.

Yep........ditto that

[SpiderGearsMan]

Re: Fixed Pricing

price fixing or collusion ?

[Fordplay0621]

Re: Fixed Pricing

I bought a Performer Intake lask week for $50.00 It ain't new, but it still works the Same. I still like the Poor Mans view on things. Now I can buy the Beer it takes to put it on.